A crypto wallet tied to the US government suffered an exploit on Thursday, with the hacker making off with funds worth $20 million.
Blockchain analytical firm Arkham first reported the incident, with multiple on-chain investigators confirming the development. Arkham revealed that the exploiter made off with $20 million worth of aUSDC, USDT, USDC, and Ethereum.
Lookonchain confirmed the attack and provided a breakdown of the stolen funds. According to the report, the hacker stole 13.7 million USDC, 5.44 million USDC, 1.12 million USDT, and 178 ETH worth $447,000 at the time.
Hackers attacked #USgovernment wallet and stole ~$20.7M!
Including:
13.7M $aUSDC
5.44M $USDC
1.12M $USDT
178 $ETH($447K).Notably, hackers transferred 148 $ETH($372.6K) to 10 #Binance deposit wallets.https://t.co/erV5T8x6eU pic.twitter.com/kczyEbLJnE
— Lookonchain (@lookonchain) October 25, 2024
Hacker Laundering Funds
Arkham first reported that the US government moved $5.45 million in USDC from the Aave interest-bearing USD wallet on Thursday. Notably, it was the first transaction made on the government-linked wallet since February.
The hacker moved almost all the assets on the US government-tied wallets to a new address, “0x3486e,” with speculations of fund relocation and potential sales making the rounds in the crypto community. The only asset left at the address is the TRUMP meme coin, worth a meager $132.
However, suspicion arose when the exploiter started moving the funds from the new address to instant exchanges like Switchain, N Exchange, and Binance Deposit. Arkham noted the funds seemed to be laundered as the hacker moved them to suspicious addresses linked to money laundering services.
At the time of writing, the hacker has laundered the USDC, USDT, and ETH moved from the US government wallet. The new address contains aUSDC worth $13.2 million and a few dollars in coins like BNB and ZYGO.
Funds Etymology
Notably, the stolen funds were seized from the famous 2016 Bitfinex hack. The US government confiscated them from a couple that reportedly hacked the crypto exchange for 120,000 BTC, worth $8 billion at the current market price.
The married couple Ilya Lichtenstein and Heather Morgan were arrested in 2022 and pleaded guilty to the fraud charges in August 2023. Notably, the US government recovered 95,000 BTC from them, worth $3.6 billion at the time.
Meanwhile, Lichtenstein and Morgan face five years and 18 months of prison sentences, respectively. The prosecutors are recommending reduced jail time due to their cooperation with investigations.
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